Friday Afternoon Business Brief

Stocks are slightly higher in afternoon trading on Wall Street, after spending much of the day moving between small gains and losses. Early gains faded after the Commerce Department said sales of new homes fell 13.4 percent in July. Traders reacted to the drop in home sales by buying bonds and gold, investments that become more attractive when the economy appears weaker.

Microsoft is launching a search for a new CEO. The man who succeeded Bill Gates 13 years ago says he'll retire within a year. Steve Ballmer's announcement comes less than two months after the company unveiled a sweeping reorganization in an attempt to reignite competition with rivals such as Apple and Google. When Ballmer took the helm in January 2000, Microsoft's market value stood at more than $601 billion. Today, the company is worth less than half that, at nearly $270 billion.

Procter & Gamble Co. says it gave former CEO Bob McDonald a pay package worth $15.9 million during his final full year at the helm of the world's largest consumer products maker. That's a 5 percent increase from the previous year. McDonald's retirement was announced abruptly in May, with the maker of Tide detergent and Crest toothpaste facing pressure to improve its results. He was replaced by his predecessor, A.G. Lafley.

Apple may face a reduced punishment for conspiring with publishers to raise e-book prices under a new proposal from the federal government. The Department of Justice suggested in a court filing today that it would cut the length of a proposed injunction in half, from 10 years to five. The injunction would keep Apple from entering deals with publishers that would limit price competition.

President Barack Obama says law schools in the U.S. should cut down to two years instead of three to cut costs for students. Obama says students do most of their classroom learning in the first two years of law school. He says the third year would be better spent clerking for a judge or working in a law firm. Obama is on a two-day bus tour to highlight proposals for lowering the cost of higher education.